亞開行-韓國稅務(wù)管理數(shù)字化轉(zhuǎn)型：經(jīng)驗教訓(xùn)和前進道路（英）

Forinquiries,comments,andsuggestions,pleasecontactthefocalpersonofthisgovernance

brief,GoNagata,PublicManagementSpecialist(Taxation),Public

SectorManagement

andGovernanceSectorOffice,SectorsGroup,atgnagata@

or+63286831400.PreviousissuesofThe

GovernanceBriefcanbeaccessedathttp://www./publications/

series/governance-briefs.

TheGovernanceBrief

ISSUE52?2023

DigitalTransformationofTax

AdministrationintheRepublicofKorea

LessonsfromExperienceandWaysForward

byDaeyongKim*

TheaimofthisgovernancebriefistoinvestigatetheexperienceoftheRepublicofKorea(hereinafter

ROK)anditsrelatedpoliciesinthedigitaltransformationofitstaxadministration.ItelaboratesontheissuesandchallengesencounteredintheROK’sdigitaljourneyandexaminesbestpracticestoeffectivelyaddresstherevenueimplicationsresultingfromthisdigitaltransformation.Keylessonslearnedaswellasrecommendationsareprovidedtoreflectthedigitaltransformationoftax

administrationinthecountry.

PublicationofthebriefwassponsoredbytheRepublicofKoreae-AsiaandKnowledgePartnershipFundoftheAsianDevelopmentBank.

I.Introduction

WiththerapidgrowthoftheFourthIndustrial

Revolutionanddigitaltransformation,there

isarisingdemandforadvancedtechnologies

andinnovativeapproachesinthefieldoftax

administration.Emergingdigitaltechnologiesand

innovations,suchasbigdataanalytics,5Gnetworks,blockchaintechnology,artificialintelligence(AI),

andothers,areanticipatedtohaveatransformativeimpactonstrengtheningtaxadministrationand

greatlypromotingrevenuecollectionefforts.

Bystreamliningtaxprocesses,enablingmore

accuratetaxpayerprofiling,facilitatingeffective

riskassessment,andpromotingbettercompliance

throughautomatedauditsandreal-timemonitoring,

thesetechnologieswillnotonlyimproverevenue

collectioneffortsbutalsoplayavitalroleintackling

complexformsoftaxevasionastaxauthorities

aremandatedtosecuretaxrevenuescollection.

Moreover,theywilladdresscross-borderbusiness

challengesandallowfortheclassificationof

*

DaeyongKimisDirectorofDevelopmentResearchintheCenterforInternationalDevelopment(CID),KoreaDevelopment

Institute(KDI).HewasaresourcespeakerinandcontributedtoInnovativeTaxAdministration:AStrategicWorkshopheldon

27–29March2023inTokyo,organizedjointlybytheAsianDevelopmentBank(ADB),theADBInstitute,andJapan’sNational

TaxAgency,withsupportfromtheRepublicofKoreae-AsiaandKnowledgePartnershipFund.

2TheGovernanceBrief

taxpayersbasedontheirbehavioralpatternsandtaxactivities,empoweringtaxauthoritieswithvaluableinsightsfortargetedinterventions.

Inthislight,developingmembercountriesof

theAsianDevelopmentBank(ADB)inAsiaand

thePacificareprioritizingpolicyenhancementsandeffortstoacceleratedigitaltransformation,which

isexpectedtosignificantlyboosttheefficiencyandeffectivenessoftheirtaxadministrationsystems

andservices.

Atthecoreoftoday’staxandrevenue

administrationslieextensivedatabases,whichare

continuouslyreplenishedbytheconstantflowof

datathatserveastheirlifeblood.Taxadministrationauthoritiesenhancethevalueoftheirdatabasesbyintegratingvariousdatafromthird-partysources

andprogressivelyharvestingpubliclyaccessible

data.However,thisprocessremainsprimarilyin-

houseandunderthecontrolofrevenueauthorities,raisingconcernsaboutitssustainabilityinthefaceofdigitaldisruption.Thiscentralizedapproach

mayalsoimposeconstraintsonswiftadaptationtotechnologicaladvancements.

Thisgovernancebriefaimstoinvestigatethe

experienceoftheRepublicofKorea(ROK)anditsrelatedpoliciesindigitaltransformationofitstax

administration,includingtheissues,challenges,bestpractices,andkeylessonsencounteredintheROK’sdigitaltransformationoftaxadministration.

II.DomesticResourceMobilizationandTaxation

Taxrevenueplaysacrucialroleinpromoting

economicgrowthandsocialdevelopment.Inthisregard,enhancingdomesticresourcemobilization(DRM)throughtaxationisvitalforincreasingtaxrevenuetoaccelerateeconomicgrowthandsocialdevelopmentindevelopingcountries.However,

achievingDRMremainsacriticalchallengein

pursuingsustainabledevelopment,sincelower-

incomecountriescollectlesstaxesasashare

ofgrossdomesticproduct(GDP).Accordingto

theUnitedNationsUniversityWorldInstitute

forDevelopmentEconomicsResearch(UNU-

WIDER)GovernmentRevenueDataset(GRD),asof2022,theproportionoftaxrevenuecollectedasapercentageofGDPis5%–20%inlower-incomeandmiddle-incomecountries,whereasitstandsat30%inupper-incomecountries.Duringthefiscalyearsleadingupto2019,despitewitnessingrobustgrowthintaxrevenues,severaleconomiesinAsia,includingCambodia,Georgia,andNepal,struggled

tobridgethegapbetweentheirtaxrevenuesand

internationalbenchmarks.Thesebenchmarks

observeawidelyrecognizedminimumthresholdof

15%tax-to-GDPratio,whichisconsideredacrucial

factorforsustainabledevelopment.Accordingto

theOrganisationforEconomicCo-operationand

Development(OECD),theaveragetax-to-GDP

ratioforthe29countriesintheAsiaandPacific

regionwas19.8%in2021(OECD2023).Ofthese

countries,13countriesrecordedtax-to-GDPratios

higherthanthisaverage,whileallthecountries

includedinthereport—exceptNauruat36.6%—

reportedratiosbelowtheOECDaverageof34.1%.

Notably,Indonesia(10.3%),Malaysia(11.4%),Viet

Nam(13.1%),andKazakhstan(14.7%)indicatedtax-

to-GDPratiosbelow15%excludingsocialsecurity

contributions(Figure1).

Globally,thereisagrowingimplementation

ofpoliciesaimedatstrengtheningDRMthrough

variousmeans,withincreasingrecognitionof

thesignificanceofdigitaltransformationintax

administration.Manycountriesandinternational

organizationsacknowledgethepowerof

digitalizationasatoolforsupporting,enhancing,

andstreamliningthecollectionandmanagement

oftaxrevenue.Digitalizationentailstheadoption

andutilizationofinformationandcommunication

technology(ICT)toimprovetaxadministration

processesandsystems.This,inturn,enhancesthe

efficiencyandtransparencyoftaxadministration,

therebycontributingtothestrengtheningofDRM.

Thecoronavirusdisease(COVID-19)pandemic

hasfurtheremphasizedtheneedfortransformation

intaxationduetoexposedvulnerabilitiesofthe

revenuesystemandpolicydemandformore

resilientfiscalstructures.

Withthegrowingacknowledgmentofthe

significanceofdigitaltransformationintax

administration,thereisasurgingglobaltrend

towarddigitalization.TheOECD(2022)shows

approximately1.3billioninteractionsthrough

onlinetaxpayeraccountsin2020,indicatinga

yearlygrowthrateof27%.Further,theOECD

notesthatthereisashiftintaxadministration

towarddigitaltransformation,andapproximately

75%ofadministrationshavealreadyadopteda

digitalstrategy(Figure2).

Theimplementationofdigitalizationcan

revolutionizetaxenforcementtechnologyby

enablingtheacquisitionofextensiveandprecise

dataonindividuals’consumptionpatterns,

leadingtoenhancedfairnessandeffectiveness

inredistributingincomethroughadvancedtax

systems.Asdigitaltransformationrapidlyevolves,

ISSUE52?20233

Figure1:Tax-to-GrossDomesticProductRatiosinEconomiesinAsiaandthePacific,2021

(%ofGDP)

40

35

30

25

20

15

10

5

0

36.6

33.833.2

29.9

28.5

26.9

25.32422.722.622.2212018.618.218.11817.716.415.615.112.612.111.810.910.910.710.39.3

Tax-to-GDPratioAsiaandthePaci?c(29)averageOECDaverage

GDP=grossdomesticproduct,LaoPDR=LaoPeople’sDemocraticRepublic,OECD=OrganisationforEconomicCo-operationandDevelopment,PRC=People’sRepublicofChina.

Source:OECD.2023.RevenueStatisticsinAsiaandthePacific.Paris:OECDPublishing.

Figure2:ExistenceofaStrategyforDigitalTransformation,2022

(%ofadministrations)

Percent

100

90

80

70

60

50

40

30

20

10

0

Strategyhasbeen...

Timeframeofthestrategy

Developed

Notdeveloped

Lessthan3years

3to5years

Morethan5years

(asapercentageofthoseadministrationsthathaveastrategy)

Note:ThefigureisbasedonInventoryofTaxInitiativesdatafrom52jurisdictionsthatcompletedaglobalsurveyondigitalization.

Source:OECDetal.2022.InventoryofTaxInitiatives

./tax/forum-on-tax-administration/tax-technology-tools-and-digital-

solution

s/.

4TheGovernanceBrief

thetaxenvironmentisexperiencingsubstantial

transformation.Inresponsetothesechanges,tax

authoritiesareswiftlyembracingdigitaltechnologiestostrengthentheircapabilitiesinrevenuecollection,strategicallytackletaxevasion,andefficiently

monitorbusinesstransactions.Additionally,

thereisaglobaltrendtowardimplementing

digitaltransformationintaxadministrationdue

toitsabilitytoeffectivelyhandlevastamountsof

information.However,developingcountriesmay

facechallengesandlimitationsinadoptingdigital

technologiesduetolimitedinfrastructureandotherresourceconstraints.Moreover,thereisariskthat

theextensiveinformationprovidedbydigitalizationcouldbemisusedbyauthoritarianregimesorfor

corruptpurposes.Tomitigatetheserisksandensurefairtaxreforms,concertedeffortsarenecessary,

includingstrengtheninggovernmentinstitutions,promotinggoodgovernance,andproviding

oversightandassistancethroughinternational

organizations.Byaddressingthesechallengesand

harnessingthebenefitsofdigitalization,countries

canstriveformoreefficientandequitabletax

systemsthatcontributetosustainabledevelopmentandeconomicgrowth.

III.Background:TheRepublicof

Korea’sEffortsinDigitalization

Since2017,theROKhasundergonea

transformativeshifttowardasmartgovernment,

characterizedbyitstransitiontoadigital

platformbasecalledSmartAdministration.Thise-governmentisbeingimplementedinvariousfields,includingtaxation,healthinsurance,and

publicservices(Appendix).TheCOVID-19

pandemichasledtoanincreaseintheadoptionofe-governmentservicesthathandleadministrative

tasksinacontactlessway.Accordingtoasurvey

conductedbytheROK’sMinistryoftheInteriorandSafetyduring2022,morethan9outof10Korean

citizens(92.2%)utilizede-governmentservices,

with97.7%ofusersexpressingsatisfactionwiththeservices.Furthermore,usageoftheROK’selectronictaxadministrationservices,knownasHomeTax,

rankedfirst,with85.6%ofsurveyrespondents

reportingusein2021.HomeTaxrankedsecondin2022withausagerateof83.2%amongtheROK’s

digitalgovernmentservices,suchasGovernment

24(89.3%),Work-Net(35.3%),andsoon.This

transitionhasresultedinsignificantachievements,

especiallyinthetangibleoutcomesofdigital

transformationintaxadministration.

Theseachievementsarebasedonkeydrivers

(Table1).First,citizenparticipation,acrucialfactor

forsuccess,hasbeenstrengthenedusingastrategy

thatwasformulatedbasedontheprincipleof

citizencentricity.Duringimplementationofthe

SmartAdministrationproject,variousstakeholders

suchasbusinesses,academia,civilsociety,and

thegovernmentactivelyparticipatedindiverse

stagesrangingfromprojectplanningandexecution

toevaluation.Second,attheorganizationallevel,

effortsweremadetoachieveorganizational

structuralflexibility,servicedevelopment,and

collaboration-orientedworkmethods.Bytaking

a“wholeofgovernmentapproach”inpromoting

datasharingwithinthegovernment,maximizing

thevalueofgovernmentdataasthecoreengine

ofdigitaltransformationhasbeenencouraged.

Third,therehasbeenastrongawarenessofthe

importanceofinformationandcommunication

technology(ICT)andacontinuouspursuitofits

advancement.Last,underpinnedbypoliticalwill

andpolicyinterest,ongoingfinancialsupport,

legalframeworks,andinstitutionalassistancehave

beenprovided.ThedigitalizationoftheROK’stax

administrationhassuccessfullyovercomevarious

obstaclesandachievedthevisionofpolicymakers

andtheirdeterminationregardinge-government.

Ithaseffectivelyfacilitatedgovernmentinnovation

throughcollaborativegovernancestrategies.

Thedevelopmentprocessofdigital

transformationintaxadministrationintheRepublic

ofKoreaapproachesthe5thstageoftheOECDTax

Administration3.0(Figure3).

Thegovernmenthasachievedsignificant

progressandimplementedeffectivemeasuresto

combattaxevasionthroughthemodernizationof

itstaxadministrationsystemandefficientDRM,

althoughfurtherimprovementsintaxpayerservices

arestillneeded.ByleveragingtheROK’sexperience,

viablesolutionstoenhancetheefficiencyand

effectivenessofdigitalizingtaxadministrationcan

beidentified.

ISSUE52?20235

Table1:KeyFactorsintheDigitalizationofTaxAdministrationintheRepublicofKorea

Drivers

KeyFactors

CitizenParticipation

?Bettergovernance

?Civic-centeredprinciple

?Participationinplanning,execution,andassessmentprocess

OrganizationandStructure

?Flexibilityoforganizationalstructure

?Servicedevelopment

?Collaborativewayofworking

InformationandCommunicationTechnologyInfrastructure

?Horizontalparticipation

?Dataandtechnologygovernance

?Dataandindustry

Policies

?Politicalleadershipandattention

?Fiscalsupport

?Legalandinstitutionalframework

Source:H.Choi.2023.SmartAdministration.Presentationatthe20234thInternationalDevelopmentCooperation

Forum.Sejong:KoreaDevelopmentInstitute.

Figure3:DevelopmentProcessofDigitalTransformationinTaxAdministrationintheRepublicofKorea

Enteringthe5thstageoftheOECDTaxAdministration3.0

AI=artificialintelligence,OECD=OrganisationforEconomicCo-operationandDevelopment,VAT=value-addedtax.

Note:Prefilledservicepertainstotaxpayerinformationalreadyprovidedontaxreturnforms,enablingtaxpayerstoeasilysubmittheirdeclarations.Source:NationalTaxServiceoftheRepublicofKorea.2023.InnovativeTaxAdministration:AStrategicWorkshop.Manuscript,27–29March2023(inTokyo).

6TheGovernanceBrief

IV.DigitalizingTaxSystems:

BestPracticesandtheRepublicofKorea’sExperience

A.TheNationalTaxServiceoftheRepublicofKorea

TheNationalTaxServiceoftheROK(K-NTS)wasestablishedon3March1966,withresponsibilitiesthatencompassvariousaspectsofbusiness

operationsrelatedtotheimposition,reduction

and/orexemption,andcollectionofdomestictaxes,includingincometax,corporatetax,value-added

tax(VAT),inheritancetax,andothers.

TheMinistryofEconomyandFinancegovernstheoperationoftheK-NTS.

TheK-NTSteaminchargeofhometaxis

dividedintothreeteams,whicharefurtherdividedintoanoperationteam(ICTManagementDivision)andmanagementteams(HomeTaxDivision1and2).Theseteams(divisions)areoperatedseparatelyforeachmissionandfunctionasshowninFigure4.

TheK-NTSisheadedbyacommissionerandiscomposedof1vice-commissioner,10bureauchiefsbelongingtotheheadoffices,1headofoperation

support,and1inspectorgeneral.Allbureaus

areinterconnected,andamongthem,theICT

ManagementBureauisresponsibleforformulatingandimplementingthefundamentalblueprintfor

nationaltaxdata,supervisionofICTstaffmembersandfinances,functioningoftaxadministration-

relatedinformationsystems,anddevelopmentof

associatedsoftware.Thebureauisalsoaccountablefortheconsolidation,adaptation,andenhancementofonlinepublicservices,administrationofextensivedatapertainingtonationaltax,andoperationof

relevantplatforms,amongothertasks.Thebig

dataCenteranalyzesinformationandprovidesittotaxpayers.Furthermore,HomeTaxDivision1

andDivision2areresponsiblefordevelopingandoperatingreal-timeincomemonitoringsystems.Thesesystemsfacilitatepaymentoftaxesby

taxpayers,includingtheprovisionofprefilledtaxservices.

TheK-NTSisaleadinginstitutioninutilizingtheKoreane-governmentsystem.Itactively

promotestheestablishmentandcontinuous

improvementofinfrastructurefortaxcollectionadministrationandtaxpayerconvenience.

Digitalizationintaxadministrationhasenabledtax

authoritiestocollectandanalyzelargeamountsof

taxdata.Inturn,thishascontributedtoensuring

thetimelycollectionoftaxesandsecuringstable

financialresources.Between1993and1996,the

K-NTSconnectedtaxofficesnationwidethrough

asinglecomputernetworkandestablishedonline

systemsforvariousfunctions,includingtaxfiling

andinvestigation.In1997,theTaxIntegrated

Systemwasestablished,whichwasamilestone

intheconstructionoftaxinfrastructureasit

significantlycontributedtotheeffectivenessoftax

administration.Since2002,theK-NTShasbeen

progressivelyimplementingthenationalpublic

serviceHomeTax,anelectronictaxfilingsystem.

HomeTaxallowstaxpayerstoconvenientlyhandle

alltax-relatedprocessessuchastaxreporting,

taxpayment,invoiceprinting,andissuanceof

certificatesonline,withoutvisitingtaxoffices.

B.TheNeoTaxIntegratedSystem

In2015,theNeoTaxIntegratedSystem(NTIS)

wasintroducedtoaddresstheagingtaxintegrated

systemandthedynamictaxadministration

environment.NTISaimedtointegrateover

30differentinformationsystems,includingthe

HomeTaxservice.Thisintegrationenablesefficient

utilizationofresourcesandseamlessadaptationto

theevolvingtaxenvironment.Today,NTISisdriving

theenhancementoftaxpayerconvenienceand

operationalefficiencythroughthemultidimensional

utilizationofthetaxdatabase,integratingadvanced

technologiessuchasAIandbigdata.

In1993,theNTSmadeasubstantial

investmentofoverW60billion($7.47million),

$1=W802.75asof1993yearaverage(Source:

KOreanStatisticalInformationService(KOSIS).

https://kosis.kr

[accessed21September2023])1

toestablishanationwidecomputingnetwork

thatconnectsalltaxofficesintheROK.This

initiativeaimedtoenhancetaxadministration

efficiencyandstreamlineprocesses.Asaresult,

theNTSdevelopedanonlinesystemfortaxfiling,

investigation,andotherfunctions.Overtime,

theNTSgraduallyimplementedcomprehensive

informationsystemssuchasHomeTax,theTax

InformationManagementSystem,E-CashReceipts,

simplifiedyear-endsettlements,andE-TaxInvoices.

1Note:“W”isthecurrencysymbolforthewonasindicatedintheADBHSU.Seep.127in

/sites/default/

files/institutional-document/31385/hsu-2022.pdf.

ISSUE52?20237

Commissioner

Operations

Support

O竹ce

Collection,

LegalAfairs

andPRBureau

NationalTaxTraining

Institute

NTSLiquor

LicenseSupport

Center

NationalTax

Consultation

Center

NTSRegional

O竹ces

Spokesperson’sO竹ce

ViceCommissioner

InspectorGeneral

?InspectionOice

?AdministrativeIntegrityOice

TaxpayerInternational

AdvocacyTaxation

BureauBureau

?ICTPlanningDivision

?BigDataCenter

?ICTManagementDivision

?HometaxDivision1

?HometaxDivision2

?InformationSecurityTeam

Property

Taxation

Bureau

?RealEstate

TaxationDivision

?InheritanceandGiftTaxDivision

?CapitalTransactionDivision

Planningand

Coordination

Bureau

ICT

Management

O竹ce

?PolicyCoordinationOice

?PlanningandFinanceOice

?RevenueStatisticsOice

?EmergencyPlanningOice

?TaxpayersAdvocateOice

?TaxAppealsOice

?International

CooperationOice

?International

TaxResources

?Ofshore

InformationDivision

?MAP/APATeam

?TaxCollectionDivision

?LegalAfairsDivision

?LegalInterpretationDivision

?PublicRelationsDivision

Investigation

EarnedIncome

Bureau

TaxBureau

Corporate

Taxation

Bureau

?CorporateTaxDivision

?WithholdingTaxDivision

?ExciseTaxDivision

Individual

Taxation

Bureau

?ValueAddedTaxDivision

?IndividualIncomeTaxDivision

?ElectronicTax

ResourceDivision

?Investigation

PlanningDivision

?InvestigationDivision

?International

InvestigationDivision

?Investigation

IntelligenceDivision

?Investigation

AnalysisDivision

?EarnedIncomeTaxCreditOperationsDivision

?IncomeManagementDivision

?ICLRepaymentUnit

Figure4:K-NTS—OrganizationoftheNationalTaxServiceoftheRepublicofKorea

?NTSSeoulRegionalOice

?NTSJungbuRegionalOice

?NTSIncheonRegionalOice

?NTSDaejeonRegionalOice

?NTSGwangjuRegionalOice

?NTSDaeguRegionalOice

?NTSBusanRegionalOice

APA=AdvancePricingAgreement,ICL=IncomeContingentLoan,ICT=InformationandCommunicationTechnology,K-NTS=NationalTaxServiceoftheRepublicofKorea,MAP=MutualAgreementProcedure,PR=PublicRelations.

Source:NationalTaxServiceoftheRepublicofKorea(K-NTS).

https://www.nts.go.kr

(accessed12June2023).

8TheGovernanceBrief

C.HomeTax:TheDigitalTax

AdministrationPlatform

HomeTaxservesasapioneeringdigitaltax

administrationplatformintheROK.Itempowerstaxpayerstoconvenientlyaccessawiderange

oftax-relateddataandinformation,making

correctionsandfulfillingtheirobligationswithouttheneedtophysicallyvisittaxoffices.Through

HomeTax,taxpayerscanobtaincertificates,issueelectronictaxinvoices,fileappeals,andperform

varioustax-relatedtasks.Inaddition,HomeTax

supportsthesubmissionofdocumentsinportabledocumentformat(PDF)filetype,eliminatingtheneedforpapersubmissions.

ThedevelopmentofHomeTaxwasledbythe

NTS,withpersonnelanalyzingtasks,formulating

businessplans,andoverseeingitsimplementation.Thefirst-generationprojectofHomeTaxwas

carriedoutintwophases.Thefirstphase,from

December2001toSeptember2002,focusedon

establishingthebasicservicesofHomeTax.Ateamof15employees,supervisedbythedirectorofthe

InformationPlanningBureauofthe2ndInformationSystemDevelopmentOffice,wasresponsiblefor

developmenttasks.InthesecondphasefromJuly2002toMay2003,anadditionalfiveemployeeswereassignedtocompletethefoundationoftheHomeTaxservice.TheNTSandtheMinistryof

EconomyandFinanceallocatedatotalproject

budgetofapproximatelyW13.78billion.The

projectwascarriedoutfromNovember2001to

May2003,withthegoalofdevelopingHomeTaxasacomprehensivedigitalplatformencompassingelectronicpaymentsystemsandtaxfiling.

Before2015,thefirst-generationHomeTax

allowedonlyperiodicandfinalizedreports,but

itwasnotpossibletoreportbytheduedate.

Anupgrade,theNext-GenerationHomeTax

(NG-HomeTax),wasdesignedtofacilitatethe

implementationofdigitaltaxationforvarious

taxpayercategoriesandtypesoftaxes,providinganefficientanduser-friendlyexperienceforKorean

taxpayers.ConstructionoftheNG-HomeTax

systemwascarriedoutbySamsung(SDS),which

hasexcellenttechnologyfromtheprivatesector,

althoughpublicfundswereused.Thisindependentconstructionteamwasoperatedintheformofa

taskforce,whichwaslaunchedwithabout100peopleintheearlydays,andthenadded200

peoplemoreinthefinalstages.TheestimatedbudgetallocatedforbuildingtheNG-HomeTaxsystemwasaroundW200billion.

NG-HomeTaxtookatotalof4yearsof

preparation.Thedevelopmentprocesswas

reorganizedstarting2011andwasdividedintobasic

designandcompletedesign.However,theproject

wassuspendedforabout6monthsduetotheneed

forprocurementandorderingtimelaginthemiddle

oftheproject.Individualsystemswereintegrated

for1yearandtheactualsystemwasestablished

over2yearsand11months.Astabilizationperiod

wassetfortherestoftheperiodthattook7months,

whichwaslongerthanoriginallyexpected.

ThetwomainservicesofHomeTaxareasfollows:

(i)Year-EndTaxSettlement

Year-endtaxsettlementinvolvesthecalculation

andfinalizationoftheincometaxamountowed

byanemployee(excludingdailyworkers)forthe

salaryincomeearnedduringaspecifictaxable

period,suchas1Januaryto31December2022.

Thisprocessisbasedontheemployee’ssubmission

ofreportsonincomedeductions,taxcredits,and

otherrelevantinformation.Incaseswherethetotal

monthlytaxwithheldexceedsthefinalamount

oftaxpayable,theexcessamountisrefundedto

theemployee.Conversely,ifthetotalwithheldtax

isinsufficient,theshortfallamountiscollected

fromtheemployeeadditionallyandremittedto

theK-NTSbytheemployee’sdirecttransfervia

thesystem.Thetaxliabilityistypicallydeducted

directlyfromtheemployee’ssalary.Incaseswhere

thetaxamountexceedsacertainthreshold(usually

W100,000),employeeshavetheoptiontopayin

installmentsratherthanalump-sumpayment.This

flexibilityinpaymentoptionshelpsalleviatethe

financialburdenontheemployee,allowingthemto

effectivelymanagetheirtaxobligations.

Theyear-endtaxsettlementservicesignificantly

contributestotheconvenienceandreductionof

taxpayercooperationcosts,leadingtoacontinuous

increaseinserviceusers.Theyear-endtaxsettlement

serviceoftheK-NTSoperatesbycollectingrelevant

informationfromfinancialinstitutions,whichserve

asreceiptissuers,andreflectingitinthesystem.Itis

helpfulthattheKoreangovernmenthasmadethe

policyefforttopersuadeallissuinginstitutionsto

integrateandcollectrelatedinformationtoestablish

thissystematicprocess.

Asof2015,theannualcost-savingeffectof

taxpayercooperationduetotheintroductionof

theyear-endtaxsettlementserviceamountedto

W210billion($185.59million),$1=W1,131.52as

of2015yearaverage(Source:KOreanStatistical

ISSUE52?20239

Table2:TotalNumberofIncomeTaxReturnReportersandTaxAmountDetermined

2017

2018

2019

2020

2021

TotalNumberofReporters(million)

18.01

18.58

19.17

19.50

19.96

TaxAmount,Determined(Wtrillion)

34.73

38.31

41.10

44.16

52.70

Source:GovernmentoftheRepublicofKorea.TaxStatisticsInformationService.

https://www.tasis.nts.go.kr